EU, Japan sign massive trade deal as US puts up barriers

  • EU, Japan sign massive trade deal as US puts up barriers

EU, Japan sign massive trade deal as US puts up barriers

"Politically, it's a light in the increasing darkness of worldwide politics", European Council President Tusk said of the deal, according to The Guardian.

"Within this context, I believe it is extremely meaningful that Japan and the European Union are sending a message to the world about the importance of free and fair trade".

The European Union and Japan are signing the single market's biggest trade deal ever and present a united front as Washington upends the global trade order. But they will bring Japanese consumers lower prices for European wines, pork, handbags and pharmaceuticals.

Following the signing ceremony, Japanese Prime Minister Shinzo Abe, said: "There are rising concerns about protectionism, but I want Japan and the European Union to lead the world by bearing the flag of free trade".

The pact creates the world's largest open economic area, covering almost a third of the world's economic output and 600 million people, BBC reported.

The signing was initially planned to take place in Brussels earlier this month, but Abe canceled a trip due to the rain disaster mainly in western Japan. He said the partnership is being strengthened in various other areas, including defense, climate change and human exchange, and is "sending a clear message" against protectionism.

According the European Commission, the deal is projected to eliminate just under $1.2 billion worth of tariffs for EU exporters and double the amount for Japanese firms.

Based on his "America First" policy, Trump has shown an increasingly protectionist stance on the trade front by taking such measures as threatening to impose further tariffs on not just steel and aluminium but also automobiles.

Japan and the European Union signed a new free trade deal on Tuesday
Japan and the European Union signed a new free trade deal on Tuesday

The ambitious pact signed in Tokyo runs counter to President Donald Trump's moves to hike tariffs on imports from many USA trading partners.

Not only has the president rolled new tariffs on allies including Canada, Mexico, and the European Union, but he has also turned away from major free-trade agreements like the Trans-Pacific Partnership and floated the idea of pulling the United States out of the North American Free Trade Agreement, or NAFTA.

The deal comes amid a trade disputes between the United States and China.

At the summit, President Juncker said: "Today's signature of the EU-Japan Economic Partnership Agreement is a landmark moment for global trade".

The EU-Japan agreement will also scrap or reduce barriers for skimmed milk powder, butter and whey. The European bloc is also pursuing deals with Mexico, Australia, and Mercosur, the South American trading bloc that includes Argentina, Brazil, Paraguay and Uruguay.

Japan's ambassador for global economic affairs, Yoichi Suzuki, has previously said it was 'a very high priority that [the deal] enter force before the end of March 2019, ' referring to the date when Britain is set to leave the EU. Japan's growth remains heavily dependent on exports. Japanese will get cheaper cheeses, such as Parmesan, gouda and cheddar, as well as chocolate and biscuits.

Japanese vehicle and auto parts makers are also expected to increase their sales to Europe, where they have lagged behind European rivals.